US retail sales edged higher in June despite lower gasoline prices that drove a sharp decline in gas station receipts.
Sales rose 0.2% last month following an upwardly revised 1% gain in May, the Census Bureau reported Thursday. The latest print matched the consensus in a Bloomberg survey.
Spending at gasoline stations fell 5.3% after a 2.6% rise in May.
Prices at the pump in the US declined for the fifth consecutive week late in June, AAA, a travel organization that tracks fuel prices in the country, said at the time. That followed a surge in retail gasoline prices due to the US-Israel war with Iran.
"The drop in gas prices pushed down spending at gas stations sharply, but overall sales held up, thanks to
big gains in a few categories," Michael Pearce, chief US economist at Oxford Economics, said.
Gains in the motor vehicles and parts category accelerated to 1.9% from 1.1%. Retail sales without the motor vehicle and gas components rose 0.4%, less than May's 0.8% increase but matching the consensus.
Sales at stores that sell electronics, sporting goods or musical instruments increased, while health and personal care outlays dropped.
"Elevated gas prices have taken a bite out of real incomes and may yet feed through to a moderation in spending growth," Pearce said. "However, spending remains well supported by a stabilizing labor market and a powerful tailwind from rising financial wealth."
Consumer spending is on track to increase by about 2% annualized in second quarter, Ksenia Bushmeneva, economist at TD Economics, said in a report.
"While some pockets of caution remain -- such as modest growth in sales at bars and restaurants and grocery stores -- consumer spending remained resilient through (the) second quarter, as elevated energy prices were partially offset by higher tax refund checks, rising equity market valuations, and some stabilization in the labor market."
